Grand Traverse County to pursue case against Meijer

GRAND RAPIDS — Meijer Inc. won the first round in its battle to end a criminal probe into its campaign activities, but northern Michigan officials are hopeful the case finds its way back to local authorities.

A judge Friday ruled Michigan's secretary of state, not the Grand Traverse County prosecutor, has sole jurisdiction over the retailer's undisclosed financial support of a recall effort in Acme Township.

"To me, it's almost like he is showing (the prosecutor) the way to finish this," Zarafonitis said.

The ruling by Grand Traverse Circuit Judge Philip Rodgers Jr. criticized the Michigan State Finance Act, which he said gives jurisdiction to the secretary of state's office.

But Rodgers said that doesn't prevent the agency from referring the investigation to the state attorney general, who then could send it back to Grand Traverse County Prosecutor Alan Schneider.

Secretary of State Terri Lynn Land did not return calls for comment Saturday, but her spokeswoman, Kelly Chesney, said the department's review is ongoing.

"Our attorneys will be advising our agency in how to move forward," Chesney said.

James Brady, one of two lawyers representing Meijer, challenged the contention that Land has the power to refer the case to the attorney general.

"We disagree with that," Brady said.

Meijer is accused of financing a behind-the-scenes effort to oust officials who opposed the retailer's Acme Township project. Records uncovered in December also implicated the Grand Rapids public relations firm Seyferth Spaulding Tennyson Inc. and the Detroit law firm Dickinson Wright.

The retailer's own investigation concluded it likely violated campaign finance laws in the February 2007 recall. It also acknowledged it may have broken the law in an earlier referendum to overturn a moratorium on big-box retail stores there. Meijer said it would cooperate with a secretary of state review.

The county criminal probe was requested by Zarafonitis and three other trustees. When Meijer declined to turn over certain records to the prosecutor, Zarafonitis sought warrants to force disclosure. Meijer lawyers said the records were protected by attorney-client privilege, but shifted their opposition to the jurisdiction issue.

"We feel the laws aren't written to protect the individual," Acme Trustee Erick Takayama said Saturday, reacting to the judge's ruling. "They are written to protect big business. The little guy is hung out to dry."

The Acme trustees have said they fear Land's office would not be aggressive because she has received campaign contributions from the Walker-based corporation and Meijer family members.

Criminal prosecution also poses the potential for harsher penalties, especially against individuals. The secretary of state's investigation could bring fines only if the case remains there.

"With any luck, it should end back up in (the prosecutor's) hands. Individuals would stand a better chance of being prosecuted if it stayed with Schneider," Zarafonitis said.